Summary of Joe Coulombe & Patty Civalleri's Becoming Trader Joe

Everest Media

Description

Please note: This is a companion version & not the original book.
Sample Book Insights:
#1 The Tail O’ the Cock was a prominent drinking establishment on La Cienega Boulevard, where Los Angeles and Beverly Hills come together. In 1965, Merritt Adamson, the president of Pronto Markets, a 16-store chain of convenience markets in Los Angeles, was having a business luncheon there. He was having problems with his largest customer, Adohr Milk Farms.
#2 In 1962, I had to sell off parts of my company to fund Pronto. I was blackmailed by a competitor who had found a way to avoid California’s high labor costs. I had to figure out what to do.
#3 I had the opportunity to thank Bud Fisher, the handsome scion of one of the founding families of Southern California, for being such a great mentor to me. We were both left-handed, which is the most important thing about a person.
#4 I had been hired to find out why the Owl Drug Company was failing. I had learned all I could at Owl, and was afraid I would begin to lose my Stanford standards for management if I stayed. I quit and went to work for Hughes Aircraft as the financial planner for their Semiconductor Division.

Informations

• Publié par: Everest Media LLC
• Date de parution: 24 mars 2022
• Nombre de lectures: 0
• EAN13: 9781669359432
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Insights on Joe Coulombe's Becoming Trader Joe
Contents Insights from Chapter 1 Insights from Chapter 2 Insights from Chapter 3
Insights from Chapter 1

#1

The Tail O’ the Cock was a prominent drinking establishment on La Cienega Boulevard, where Los Angeles and Beverly Hills come together. In 1965, Merritt Adamson, the president of Pronto Markets, a 16-store chain of convenience markets in Los Angeles, was having a business luncheon there. He was having problems with his largest customer, Adohr Milk Farms.

#2

In 1962, I had to sell off parts of my company to fund Pronto. I was blackmailed by a competitor who had found a way to avoid California’s high labor costs. I had to figure out what to do.

#3

I had the opportunity to thank Bud Fisher, the handsome scion of one of the founding families of Southern California, for being such a great mentor to me. We were both left-handed, which is the most important thing about a person.

#4

I had been hired to find out why the Owl Drug Company was failing. I had learned all I could at Owl, and was afraid I would begin to lose my Stanford standards for management if I stayed. I quit and went to work for Hughes Aircraft as the financial planner for their Semiconductor Division.

#5

The first experimental chain of six Prontos was successful. Two years into the project, however, lightning hit: Justin Dart, the president of Rexall, bought Tupperware, against the unanimous vote of his board of directors. Within a year, Tupperware was generating a third of Rexall’s profits.

#6

I had to buy Pronto or find a new job in 1962. The decline of the stock market accelerated, and I had to raise the money within 90 days.

#7

I was able to find the money to buy Pronto Markets, but I was still way short when I went to see Tom Deane at Bank of America. He loaned me the money on my personal signatures.

#8

I did not like Pronto Markets as it existed in 1962. I did not have to find an optimum solution to the company’s problems, just a reasonable one. I chose to pay the company’s employees well, which was the most important single business decision I ever made.

#9

The reason no one has been able to replicate Trader Joe’s is that no one has been willing to pay the wages and benefits, and attract and keep the quality of people, that Trader Joe’s does.

#10

I built overtime into the system so that everyone would work a five day, forty-eight-hour week. The company was eventually big enough to be covered by the Fair Labor Standards Act in 1963.

#11

The most expensive form of labor expense is turnover, which is why I believe that tenure is the most important factor in productivity. You can’t afford to have cheap employees, because good people will pay by their extra productivity.

#12

The problem with a convenience store is that it is hard to invest enough money to let the people be productive enough to justify high wages and benefits. I had put the cart before the horse by paying high wages to employees who were limited in their productivity due to the small size of their store.

#13

7-Eleven was able to enter the California market because they did not have to store or buy alcohol as a chain. Their franchise system amounted to serfdom, in my opinion, but it staved off the union and allowed them to pay about one-third the wages of Pronto.

#14

As a second way to pump investment into the Pronto stores, we began to add hard liquor, instead of just beer and wine, to the stores. The cost of a liquor license in those days was so high that the addition of a liquor license doubled the investment in a store without expanding beyond the 2,400 square foot conventional convenience store module.

#15

I had begun to get product knowledge after buying out Rexall. I realized that Extra Large Eggs were only produced by the oldest hens, and not many of them. I began running ads promoting their purchase, which revolutionized Pronto Markets and helped generate the profits I needed to stay afloat.

#16

I had been making a lot of money in Pronto, following the success of the egg program. I was able to pay off Adohr quickly, with some more help from Bank of America. Merritt Adamson acted like a prince in facilitating this.

#17

I realized that convenience store retailing was a good opportunity, but too good for my financial resources. I needed a small but good opportunity for my company, which gave me the hubris to think we could pull it off.

#18

The early nineteenth century saw the displacement of barter societies with cash economies, which in turn permitted retailers to appear. The pace quickened after the first automatic glass bottle machine was built in the 1890s, making it possible to can soft drink brands like Coca-Cola.

#19

The Great Depression began in 1930. The drug chains began to price bomb Pepsodent to draw foot traffic, and establish a symbiosis between retailers and powerful brands that has lasted ever since.

#20

The supermarket, like network radio, was also invented in the 1930s. The supermarket rose to prominence because it recognized the automobile, something that department stores did not recognize until after World War II.

#21

The triumph of brand advertising affected many different types of businesses besides the supermarket chains.